If you're on a low income, you know the stakes when it comes to keeping a budget. A trip to the hospital or a lost job could mean bills you can't pay and trouble getting ahead.
Those struggles are compounded for many of Cincinnati's Black residents, who have seen decades of discrimination and lack of economic opportunity. But city officials on Monday announced efforts aimed at testing ways to address those economic disparities.
Those include programs testing out guaranteed basic income, medical debt relief, and savings accounts for children. Along with them, the city has already launched an effort providing legal assistance for residents facing eviction.
The series of programs has been in the works for the past year, Mayor Aftab Pureval says. Planning work for the so-called "Financial Freedom Blueprint" was paid for with a $75,000 grant from the Cities for Financial Empowerment Fund, a national nonprofit that is supported by Bloomberg Philanthropies' Greenwood Initiative. The study recommending the programs the city will launch included a survey of 1,000 city residents and can be found here.
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Though details of the programs haven't been released yet, the broad outlines look something like this:
- The city would spend about $250,000 in "seed money" toward a $2 million guaranteed basic income pilot to study the idea's effectiveness. About 100 eligible Cincinnati residents would receive cash payments and the city would measure whether their economic situation improved over time.
- The city will partner with nonprofit RIP Medical Debt for the debt relief portion of the plan. That group buys medical debt for pennies on the dollar, relieving those who aren't able to pay old medical bills. Pureval has previously said that portion of the program would cost about $1.5 million and could benefit up to 30,000 residents of the city.
- The city will dedicate another $375,000 over the course of three years to provide every child enrolled in Preschool Promise with a savings account. Each child would get an initial $50 deposit in the account, providing interest and learning opportunities around saving and banking as the child grows up.
Pureval says the program is a first step toward testing new solutions to the city's poverty issues and the economic disparities faced by its minority residents.
Almost 25% of households in Cincinnati lived below the poverty line last year, according to data from the U.S. Census. But that poverty isn't spread evenly among the population — more than 40% of the city's Black residents live in poverty.
The gap is due to systemic issues that go back generations and have kept Black families from accumulating wealth in the same way white families did, Pureval says. Discriminatory housing policies, redlining and other racial dynamics meant it was difficult for Black residents to buy and maintain homes in Cincinnati for decades — a key way families build wealth over generations.
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"A core focus of ours, both the mayor, council and this administration, has been on addressing this fundamental challenge," Pureval said. "Growing economic opportunity with racial equity in the center of the frame, and importantly, centered around ownership."
Vice Mayor Jan Michele Kearney says the city chose the initiatives carefully, using ideas that have succeeded in other cities at reducing poverty and providing more stability and upward mobility for residents.
"These programs aren't things that were just pulled out of hats," she said. "They're data-driven. They're working in other cities across the country... we'll have more data with the programs we're doing here in Cincinnati."
Pureval says the details of the programs are still being ironed out and will be announced soon. But Cincinnati City Council has already committed $2.125 million in funding to support the pilot programs.